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Informist, Wednesday, Sept. 24, 2025

By Ketaki Patil

MUMBAI – Yields on corporate bonds closed steady in the secondary market on Wednesday because of requirement-based trading, dealers said. Some traders focussed on the primary issuance of the National Bank for Agriculture and Rural Development and refrained from taking aggressive positions in the secondary market, they said.

"Also, buying requirement from certain investors absorbed the supply today, which kept yields steady," a dealer with a mid-sized brokerage said. "Traders shifted their focus to issuances in the primary market where several companies were present to borrow funds...but in secondary market it was all need-based majorly."

In the primary market, issuances aggregated to INR 88.90 billion, including that of NABARD, which raised INR 40.40 billion through Jan. 19, 2029 bonds at a coupon of 6.85%. "Market was expecting coupon to be in the range of 6.90-6.95%, but they (NABARD) set it at 85 (6.85%) and raised about 5000 crores rupees (INR 50 billion) which was the highlight of the day," a fund manager at a mutual fund house said.

On Thursday, bond issuances aggregating INR 40.28 billion are lined up. Solar Energy Corp. Ltd. will tap the market for the first time. The company plans to raise up to INR 6.00 billion through a 10-year bond. Knowledge Realty Trust plans to raise up to INR 16.00 billion and Reliance General Insurance Co. Ltd will raise INR 4.00 billion. Vivriti Capital Ltd. and Navi Finserv Ltd. plan to raise funds by reissuing bonds. 

Dealers expect more public sector undertakings to tap the market. However, demand will depend on how issuers set the coupon. "If issuers leave some room in pricing like NABARD did, they will (issuers) see healthy demand," the fund manager quoted above said. "But aggressive pricing could slow down subscriptions."

In the secondary market, deals aggregating to INR 110.49 billion were recorded on the National Stock Exchange and BSE combined, lower than INR 130.78 billion on Tuesday. Mutual funds were active on both sides, buying and selling shorter tenure bonds. Some insurance companies, along with some pension funds, were active in longer tenures, dealers said. Corporate entities were absent from the market Wednesday.

Papers issued by Kerala Infrastructure Investment Fund Board, Navi Finserv, NABARD, Telangana State Industrial Infrastructure Corp. Ltd., Sammaan Capital Ltd., The Andhra Pradesh Mineral Development Corp. Ltd., and REC Ltd. were the most traded papers on the exchanges Wednesday.

Market participants expect yields in secondary market to remain range-bound in the near term. "Most (participants) will likely continue with requirement-based trading, awaiting clarity from the upcoming Monetary Policy Committee meeting next week before taking fresh positions," the fund manager quoted above said.

UDAY BONDS

None of the Ujwal DISCOM Assurance Yojana bonds were traded Wednesday, according to data from the Reserve Bank of India's Negotiated Dealing System–Order Matching System.

BENCHMARK LEVELS FOR CORPORATE BONDS:

End

Edited by Ashish Shirke

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